Real Estate Consultant · Mena, AR · Member since 2017 · 8 posts · 4 votes
Hi. I'm a newbie here and have a question. I'd like to know what options I might have.
I've owned and resided in a duplex now for about 12 years, paying the mortgage every month, with my self-employment income and long term tenants. I ran into a problem when I wanted to get a loan for a 2nd property because my income tax statements show my income as too low. Bank told me I would need to show enough income from a job that I've had for at least 2 years. But I've not had a "job" in a long time. Just my self-employment, rental income, (and worked for cash on the side).
I've managed to save a few thousand, but don't know where or how to start.
I'm all on my own. I don't know very many people, and need to build my network.
What advice could anyone give? Thanks for reading.
Hi. I'm a newbie here and have a question. I'd like to know what options I might have.
I've owned and resided in a duplex now for about 12 years, paying the mortgage every month, with my self-employment income and long term tenants. I ran into a problem when I wanted to get a loan for a 2nd property because my income tax statements show my income as too low. Bank told me I would need to show enough income from a job that I've had for at least 2 years. But I've not had a "job" in a long time. Just my self-employment, rental income, (and worked for cash on the side).
I've managed to save a few thousand, but don't know where or how to start.
I'm all on my own. I don't know very many people, and need to build my network.
What advice could anyone give? Thanks for reading.
Get a 2nd job. If the 2nd job's pay is not based on commission you don't need to wait 2 years. You can count that income towards your DTI in a matter of a couple paychecks.
Investor · Melbourne, Victoria · Member since 2017 · 25 posts · 13 votes
8y
Don't let one lender saying no hold you back. Get in contact with a few different lenders. Different lenders have different policies and for some they will be happy with your self employment and rental income.
I've heard good things about local community banks so you could start with those.
If you contact a few different lenders someone will eventually say yes.
Investor · Akron, OH · Member since 2016 · 2k+ posts · 4k+ votes
8y
We had that issue too. You might try seeking commercial financing through a portfolio lender. They seem to look more at credit and net worth than income for the borrower and the most important thing seems to be the DSCR and overall quality of the deal. Your terms won't be quite as good but you can do much bigger deals if you have the downpayment.
Hayward, CA · Member since 2017 · 91 posts · 40 votes
8y
I would suggest doing more studying before jumping in. It seems you don’t know much about real estate investing. Conventional loans are more affordable and more reliable for a newbie then going for the private money which is more for educated investors. Look out for scammers.
Start with reporting all of ur income. U won’t go far trying to cut out the IRS.
Rental Property Investor · Northern, CA · Member since 2012 · 5k+ posts · 5k+ votes
8y
You should be able to count your self-employment income and your rental income if you've been getting (and reporting) it for 12 years. It sounds like you're not reporting the "cash on the side" though. If that's the case, don't expect to have that counted towards your income. As others have suggested, check with multiple lenders. Just because one can't do something, doesn't mean another one won't be able to.
Hi. I'm a newbie here and have a question. I'd like to know what options I might have.
I've owned and resided in a duplex now for about 12 years, paying the mortgage every month, with my self-employment income and long term tenants. I ran into a problem when I wanted to get a loan for a 2nd property because my income tax statements show my income as too low. Bank told me I would need to show enough income from a job that I've had for at least 2 years. But I've not had a "job" in a long time. Just my self-employment, rental income, (and worked for cash on the side).
I've managed to save a few thousand, but don't know where or how to start.
I'm all on my own. I don't know very many people, and need to build my network.
What advice could anyone give? Thanks for reading.
Get a 2nd job. If the 2nd job's pay is not based on commission you don't need to wait 2 years. You can count that income towards your DTI in a matter of a couple paychecks.